OPENING STATEMENT MADE BY HON DR EKWOW SPIOGARBRAH, MINISTER OF TRADE AND INDUSTRY AT THE
ECOWAS/UNCTAD STAKEHOLDER CONSULTATION ON THE
DEVELOPMENT OF A REGIONAL STRATEGY FOR THE CFTA
NEGOTIATIONS WHICH WAS HELD IN ACCRA FROM 9TH -11TH
MARCH, 2016
MR. CHAIRMAN
OFFICIALS FROM ECOWAS COMMISSION
RESOURCE PERSONS FROM UNCTAD SECRETARIAT
DISTINGUISHED INVITED GUESTS
LADIES AND GENTLEMEN
It is an honour for me to address this ECOWAS/UNCTAD Stakeholder
Consultation on the Development of a Regional Strategy for the Africa
Continental Free Trade Area (CFTA) Negotiations.
Let me at the outset thank ECOWAS, UNCTAD and GIZ for organizing this
Stakeholders Consultation to enable ECOWAS Member States Strategize for
the CFTA negotiations in order to derive maximum benefits and minimize the
losses from the Agreement.
Ghana was happy to see that the vision of the Pan African Movement for
regional integration is now gradually becoming a reality with the launching of
the CFTA in Johannesburg, South Africa in June 2015 by African leaders to
establish a Continental Free Trade Area by 2017 to accelerate and deepen the
continent’s market integration.
The importance of trade to the growth and development of any nation has
become unquestionable. Trade, certainly, has the potential of ensuring economic
growth and lifting millions of people out of poverty.
By virtue of the peculiarities of most African countries including the small sizes
of our markets and the attendant weak purchasing power of consumers, the
potential of trade and private sector development has not been fully realised.
As you may be aware, Free Trade Areas (FTAs) have become extremely
important strategy for development across the regions of the world as a result of
the increasingly deepening of globalization and integration. Major continents of
the world are finding it prudent to pool resources and markets together in order
to become more competitive and reap the benefits of integration. The
experience of regions such as the EU, ASEAN, NAFTA and MERCOSUR,
which used FTAs as building blocks in their process of regional integration,
indicates that FTAs can make important contributions to successful market
integration and contribute significantly to economic growth and development of
the participating nations.
For instance, the creation of the EU internal market led to an increase in the
level of Intra-EU trade which now stands at about 63% and has contributed
enormously to growth of GDP and employment.
In Africa, the East African Community (EAC) trade data indicated that
international trade in the region more than doubled from $1.6 billion in 2004 to
$3.5 billion in 2010 as a result of choosing the path of integration.
DISTINGUISHED LADIES AND GENTLEMEN
African regional integration through a continental Free Trade Area has become
more eminent and critical now than ever, because of the proposition and the
conceptualization of Action Plans to implement a number of Mega Trade deals/
Agreements like Trans-Pacific Partnership (TTP), Transatlantic Trade and
Investment Partnership (TTIP), and Regional Comprehensive Economic
Partnership (RCEP). Since these have serious and major implications for
Africa’s development, it is incumbent on African countries to fast-track and
boost intra-African trade in order to be relevant in the global economy.
DISTINGUISHED LADIES AND GENTLEMEN
It is gratifying to acknowledge progress that was made in June 2015 by the
COMESA, SADC and EAC for adopting the Tripartite Free Trade Area (TFTA)
which is made up of 26 countries with a population of nearly 625 million people
and a total GDP of approximately US $1 trillion. It is further envisaged that the
26-country Tripartite FTA, together with other regional FTA processes, would
set the stage for a broader and a grand Continental Free Trade Area.
As have been projected by the United Nations Economic Commission for
Africa (UNECA), a successful implementation of a Continental Free Trade
Area could increase intra-African Trade by as much as $35 billion per year, or
52% above the baseline by 2022. Consequently, imports from outside the
continent could decrease by $ 10 billion per year, whereas Agricultural and
Industrial exports would increase by $ 4 billion (7%) and $ 21 billion (5%)
above the baseline respectively. Additionally, it has been projected that coupled
with complementary Trade Facilitation measures to boost the speed and reduce
the cost of customs procedures and port handling, the share of Intra-African
Trade would more than double over the baseline to 22% of total trade by 2022.
The creation of a single continental market for goods and services, with free
movement of business people and investments, would help bring closer the
Continental Customs Union and the African Common Market and turn the 54
single African economies into a more coherent, larger market. Furthermore, the
CFTA would facilitate the exploitation of economies of scale; help move factors
of production across borders; increase rate of diversification and transformation
of our economics; reduce venerability of external shocks and boost employment
opportunities.
MR CHAIRMAN
The engagement of the private sector in the initiation of government policies at
the national, sub-regional levels and continental remains pertinent. With
privatization and deregulation in the last few decades, most governments have
largely retreated from business and entrusted the private sector to take the lead
in stimulating growth and creating jobs. The most resilient economies are those
which have managed to establish a true partnership between government and
the private sector.
To a large extend, the successful implementation of the CFTA would depend on
how well it meets the needs of the private sector. It is generally expected that
the rules that African countries enact for the conduct of trade such as the CFTA
are meant to be exploited by the private sector. Private sector engagement and
sensitization on the CFTA is therefore critical at all levels. In this regard there
should be a concerted drive to engage in high level consultations and
sensitization with the private sector in the entire negotiation process of the
CFTA and the public at large across the continent to ensure this will not be just
another Addis-driven “top-down” political exercise to ensure the successful
establishment of the CFTA within the time frames.
The role of financial institutions in ensuring the successful implementation of
the CFTA is also crucial since business transactions and advisory services will
be provided by them. Consequently, the AU and Member States should get
some friendly international and Pan African financial institutions involved in
the process from now to provide financial support and technical advice.
MR CHAIRMAN
Admittedly, deriving benefits from international trade remains a challenge for
most of our countries as measures such as Rules of Origin, infrastructure
deficits, lack of diversification, overly high standards and technical barriers
disguised as trade policy tools continue to restrict us from taking advantage of
market access opportunities, thereby hampering our effective integration into
the multilateral trading system.
It is in this light that we all have to put our shoulders to the wheel, as
Politicians, Public Officers, Businessmen, Farmers, among others, on the
continent to enable us drive and fast track the various integration processes in
order for us to reap and enjoy the many benefits inherent in integration.
MR CHAIRMAN, DISTINGUISHED LADIES AND GENTLEMEN
I would like to conclude by reiterating that the CFTA remains a viable vehicle
for improving the economic development of our countries. African leaders are
urged to give this noble dream of the CFTA a push to see to its success in our
time with strong political will. I wish you a successfully stakeholder
consultation.
Thank you